WEBVTT - Bloomberg's Lippert on Emissions Issue With Ford F-150 (Audio)

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<v Speaker 1>the first Breaking news task on Bill Maloney, Charlie, all right,

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<v Speaker 1>thank you to hear live breaking news over your Bloomberg

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<v Speaker 1>I'm Charlie Palaton. That's a Bloomberg business flash. You're listening

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<v Speaker 1>to taking start with Fox on Bloomberg Radio. It's the

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<v Speaker 1>crown jewel of the Ford Motor Company. It's best selling model,

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<v Speaker 1>certainly in the truck category, the Ford F one fifty.

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<v Speaker 1>Our reporter John lipp It, though for Bloomberg News, has

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<v Speaker 1>found in his story. He reported on for Bloomberg Today

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<v Speaker 1>that some versions of the new F one fifty still

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<v Speaker 1>don't meet the government's twenty sixteen admission and fuel economy mandates.

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<v Speaker 1>And this is a problem because by those hurdles, those

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<v Speaker 1>fuel mandates will become much more stringent. John, Welcome to

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<v Speaker 1>taking stock and congratulations on a very interesting story. So

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<v Speaker 1>what is it the heart of this? What kind of

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<v Speaker 1>what kind of problems did you turn up and how

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<v Speaker 1>did you do it? Well? I had the heart. It

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<v Speaker 1>is just I guess if you took a poll, everybody

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<v Speaker 1>would say I'm in a a favorite of clean air. But

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<v Speaker 1>the question is was it take to get that? And

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<v Speaker 1>so we're talking about the Crown Jewel. As you said,

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<v Speaker 1>you know, the a half of for its North American

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<v Speaker 1>profit is wrapped up in these big pickups. And big pickups.

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<v Speaker 1>You know, they have four wheel drives, they have town capability,

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<v Speaker 1>they have all this stuff, and plus are not very

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<v Speaker 1>good aerodynamically. So it's just harder to move the needle

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<v Speaker 1>on a big pick up than it is on a

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<v Speaker 1>Ford Focus. So it's not and we've got to point out,

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<v Speaker 1>I mean, it's not just Forward that's struggling, because it's

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<v Speaker 1>everybody and um and and the government is you know,

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<v Speaker 1>they're showing no signs of backing off. I mean Obama

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<v Speaker 1>has has said fifty four point five miles from bawling

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<v Speaker 1>as a as a corporate average, and that's where the

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<v Speaker 1>government intends to go John, I just want to offer

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<v Speaker 1>a statement from Ford because we contacted them, of course

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<v Speaker 1>because of the story. Uh. They said that Bloomberg's F

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<v Speaker 1>one fifty story is wrong. They said that Ford exceeds

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<v Speaker 1>fuel economy standards and the F one fifty is a

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<v Speaker 1>strong positive contributor to Ford's fuel economy compliance and say

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<v Speaker 1>that the F one is also has best in class

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<v Speaker 1>gasoline fuel economy customs, recognizing F one fifties best in

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<v Speaker 1>class capability and fuel efficiency with strong and grow sales

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<v Speaker 1>while major competitors are losing market share end quote. What

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<v Speaker 1>is your response? Well, I think that I think that

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<v Speaker 1>the forward, I mean we our headline said the fifty

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<v Speaker 1>has a big problem, right and forward that that's the

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<v Speaker 1>core of They're saying that that headline implies that the

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<v Speaker 1>entire program is auto compliance now and so on and

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<v Speaker 1>and and that's notw what're that's how the story says.

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<v Speaker 1>So so when we use the word problem, we're saying, um,

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<v Speaker 1>after having spent a lot of money in six years

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<v Speaker 1>to redesign and put aluminum body for you know, a

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<v Speaker 1>lot of technology, after having done all this, there the

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<v Speaker 1>program as a whole complies UM. But as Kathleen said

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<v Speaker 1>that in the intro, everything gets much harder. So right

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<v Speaker 1>now a truck you know sort of average f one

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<v Speaker 1>fifty is about twenty four miles again, requirement that goes

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<v Speaker 1>to thirty three. And so I'd say they ran the

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<v Speaker 1>Olympics um to get to this point, and now they've

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<v Speaker 1>got to run the Olympics, you know, a bunch more

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<v Speaker 1>times in order to keep up with where the government

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<v Speaker 1>is taking these regulations. And of course um you cite

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<v Speaker 1>a report by Barkley's analysts Brian Johnson, another piece of

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<v Speaker 1>research from Gopaul Dooley from HD Systems. So is this

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<v Speaker 1>I'm just curious if the information they got is something

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<v Speaker 1>that's publicly available and it's you're saying four Just this

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<v Speaker 1>kind of disputes how the problem is described or how

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<v Speaker 1>the issue is described rather than saying it's wrong. And

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<v Speaker 1>if that's the case, what do they say about saying no,

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<v Speaker 1>we can meet these targets? Well, forward, yeah, Forward is

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<v Speaker 1>saying that they will meet um um regulatory requirements. There

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<v Speaker 1>you know, they're meeting them now and will continue to

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<v Speaker 1>do so. And we when in the story, you know

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<v Speaker 1>they've got hybrid pick up coming they're looking at diesel.

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<v Speaker 1>They may even put a four cylinder in the F

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<v Speaker 1>one fifty for the first time in the US. So

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<v Speaker 1>I mean they've got a lot of uh technology that's coming.

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<v Speaker 1>But it's not just I mean, I mean in a

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<v Speaker 1>way for them to say we will meet the standard,

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<v Speaker 1>it's it's um um, it's it's it's sort of true

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<v Speaker 1>by definition because if you if you don't meet the

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<v Speaker 1>admission standard, you can't sell the truck and then basically

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<v Speaker 1>boards out of business. Sean, I just want to we

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<v Speaker 1>only have a limited amount of time. I just want

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<v Speaker 1>to get your thoughts here. Just could you explain to

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<v Speaker 1>people in about thirty seconds what the methodology was that

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<v Speaker 1>you used in order to come up with the details. Well,

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<v Speaker 1>the methodology, I mean working with UMP to leave in

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<v Speaker 1>others is just the targets around public by footprint on.

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<v Speaker 1>You add up to targets and into U I mean,

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<v Speaker 1>you add up to performance into a corporate average and

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<v Speaker 1>it needs to see how it comes out. I mean,

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<v Speaker 1>so the methodology is pretty straightforward. So in words to

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<v Speaker 1>measuring the performance of the truck now against the standards

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<v Speaker 1>as you have pissed now and then saying and what

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<v Speaker 1>happens when the standard moves higher going forward. Thank you

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<v Speaker 1>very much. John Lippert, automotive reporter for Bloomberg News, speaking

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<v Speaker 1>about Ford Motor Company. It's f one FI shares of

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<v Speaker 1>Ford up ten cents right now th eleven cents for Ford.

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